Trusts and Inheritance Tax

Trusts remain a reliable way to ensure family money and assets are passed to the next generation and are frequently used to provide for future education. Each Trustee is legally required to ensure a Trust is compliant with the law, including taxation, and to act in the best interests of the Trust’s beneficiaries.

With such a responsibility and with many benefits to organising a Trust (despite the high tax rate), it’s important to get it right. At Harris Stewart, Claire Spinks is our expert in Trusts and Inheritance tax.

Our services for UK and non-UK Trusts include:
● Trust tax compliance
● Completing required annual self assessment tax returns
● Organising statements of income distributions paid, to all beneficiaries
● Ensuring discretionary Trusts pay the lowest possible amount of tax
● Claiming back tax repayments which are due to the beneficiaries within the time limits

As with most documentation, if a Trust has a large number of assets, associated bank accounts, or income types, preparing it may be time consuming and difficult. Our services use our years of dedicated experience to ensure your Trust works to its full potential, and we account for the Trust monthly, quarterly or annually as required.

Issues with Inheritance Tax
During the lifetime of a Trust, there are additional required reports to meet annual compliance. Trusts under the relevant property regime (from March 2006) must report every 10 years, and in any instance where capital monies or assets are distributed out of the Trust.

In each of these scenarios, Inheritance Tax may be payable and even when this is not the case, they are still reportable events that must be filed with HMRC. Our specialist advisors can help plan the timings of distributions and review your objectives to reduce tax payments.

Non-UK domiciled Inheritance Tax planning
Under new legislation, non-UK domiciled individuals can be subject to UK Inheritance Tax on their worldwide assets if they’ve been a resident in the UK for 15 out of the last 20 years. This is because their long term residency will make them deemed domicile in the UK.

Financially, this means that more money may be paid in tax. One way for individuals domiciled outside of the UK to avoid this charge is with a non-UK Trust. This can keep non-UK property from being in the scope of the UK’s Inheritance Tax.

Harris Stewart has years of experience and insight into anti-avoidance rules for advanced and effective tax planning within UK legislation to ensure you don’t pay Inheritance Tax that is not required. Our team can guide you through every aspect, and our directors have been awarded the Advanced Certificate in International Taxation qualification from the Society of Trust and Estate Practitioners (STEP).

Speak with our team today 
To discuss our Trusts and Inheritance Tax services, please contact Claire Spinks with your query. We look forward to hearing from you, whether you have an existing UK or non-UK Trust, are planning to create a Trust, or need advice on recent changes in legislation.